Electricity Accounts for Almost 20% of the Cost of Making

question 3

Multiple Choice

Electricity accounts for almost 20% of the cost of making steel.A 10% increase in electricity prices results in steel firms decreasing production and thereby demanding 5% less electricity.Over many years,technological innovations can change the way steel firms make steel and reduce the industry's energy requirements.This suggests that the steel industry's short-run elasticity of demand for electricity is probably

• A) less than one in absolute terms in the short run.
• B) less than its long-run elasticity of demand for electricity.
• C) Both A and B above.
• D) Neither A nor B above.

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Definitions:

Logical Reasoning

The process of analyzing a situation and coming to a conclusion based on a set of given rules or principles.

Motor Coordination

The ability to move and control body movements and positions efficiently through the coordinated action of muscles and the nervous system.

Gonads

The primary reproductive organs in animals that produce gametes; in males, they are the testes, and in females, the ovaries.

Thyroid

A gland located in the neck that produces hormones regulating the body's metabolic rate as well as heart and digestive function, muscle control, brain development, and bone maintenance.